Whether or not it's worth it to invest in insurance for your smartphone depends on the phone and when you bought it.

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It's truly amazing the rate at which smartphones have been evolving over the past several years. While carrier upgrade cycles generally last two years, new smartphone models come out every year and sometimes even every six months! If you currently own a cell phone and or have bought one for your child, you probably also opted to get monthly cell phone insurance. If you are unfamiliar with the ins and outs of your insurance plan, here's how it generally works:

Along with your monthly cell phone service charge, you are charged a monthly insurance fee usually around $10 for a smartphone. If you were to lose or break your phone, you would then pay the insurance company a deductible upwards of $199, if you own the new iPhone 5s, for example. The actual cost of replacing the iPhone 5s is $650 for the 16GB model.

Now figuring in $10 a month for two years plus the $199 deductible ($440), it would seem like a good deal to pay insurance for the lifetime of the phone. That would be true if not for the rapid depreciation of smartphone values over just two years!

I personally ran into this issue with the Samsung Galaxy SII. Filing a claim close to the end of my carrier contract meant paying a $200 deductible to replace a phone that was no longer worth $200. And even though the phone's value had dropped, my insurance company Asurion, the biggest name in cell phone insurance, was still charging me the same $10-a-month fee. At that point, I was better off buying the phone on eBay or getting a new phone altogether.

The best thing you can do, if you decide to get smartphone insurance, is check the actual price of your phone (out of contract) online periodically. If you can buy the phone online for less than your deductible, it's time to cancel your insurance. Also, opting for insurance on lower end smartphones is even less worth it; you're often paying the entire price of the phone to the insurance company by the end of a two-year contract.

Cell phone insurance can be worth it, most notably for the first six months to a year and if you or your child is prone to losing or damaging the phone. However, paying for insurance for the entire life of the phone is often not worth it, especially if you are continuing to pay insurance after your two-year contract has ended.